TORONTO, ON and MARSEILLE, France, May 10 /CNW Telbec/ - Foraco
International SA (TSX: FAR) (the "Company" or "Foraco"), a leading
global provider of diversified drilling services, today reported
unaudited financial results for its first quarter 2011. All figures are
reported in US Dollars (US$), unless otherwise indicated.

"As anticipated when we reported a record order backlog at the end of
2010, this first quarter has benefited from excellent market conditions
generated by a booming exploration market, larger orders and
renegotiated contracts. We are pleased to report revenue and net
earnings respectively at 2.7 and 5.6 times higher than in the
corresponding period last year. The bottom line is a record high EPS of
US$ 7.75 cents for the quarter. This is a good performance, when
considering during the period we went through adverse weather
conditions in Canada, had a slow start in Latin America and Russia,
mobilized many projects in Africa and had to deal with a very tight
labor market, "said Daniel Simoncini, Chairman and co-CEO of Foraco".
Based on the indicators available today and on the current demand for
drilling services, we are confident for the coming quarters."

"Financially this has also been a strong first quarter and we are
pleased to report that South America has confirmed the improvement in
contract margins previously seen," commented Jean-Pierre Charmensat,
co-CEO and Chief Financial Officer. "The Company's EBITDA has risen to
24% of revenue, and during the quarter, we invested a record high US$
11.2 million including 4 new rigs. Even after financing additional
working capital requirements resulting from the significant increase in
activity, we maintained a sound financial structure. In addition, we
negotiated our long and short-term financing facilities in order to
align them to our enlarged operations."

Three Months Q1 2011 Highlights

On May 26, 2010, the Company acquired a 100% shareholding in Adviser
Drilling SA ("Adviser"), a company based in Chile. Adviser operates a
fleet of 54 modern diamond and reverse circular drill rigs and provides
services to major and junior mining companies in South America, mainly
in Chile and Argentina. Adviser was not yet part of the Group and
therefore was not consolidated in Q1 2010.

On May 27, 2010, the Company completed the acquisition of a 50%
controlling interest in LLC Eastern Drilling Company ("EDC"). EDC's
operational facilities are positionned in far East Russia and Eastern
Siberia where many mining developments are located and managed from.
EDC was not yet part of the Group and therefore was not consolidated in
Q1 2010. However, given the low level of activity during the winter
season up to March, the contribution of EDC to the Group's Q1 2011
revenue is limited.

Revenue

Q1 2011 revenue increased by 2.7 times to US$ 65.3 million from US$ 24.5
million in Q1 2010, up US$ 40.8 million.

The US$ 40.8 million increase is primarily the result of:

US$ 25.7 million in revenue from South America,

US$ 15.1 million in organic growth, a 62% increase.

Profitability

Q1 2011 gross profit including depreciation within cost of sales
amounted to US$ 14.5 million, an increase of US$ 9.1 million or 2.7
times on Q1 2010.

Q1 2011 EBITDA amounted to US$ 15.5 million (23.7% of revenue) compared
to US$ 4.8 million in Q1 2010 (19.6% of revenue).

Q1 2011 net profit after tax amounted to US$ 5.9 million, an increase of
US$ 4.9 million or 5.6 times on Q1 2010.

Foraco's financial statements are prepared in accordance with
International Financial Reporting Standards ("IFRS"), rather than
Canadian Generally Accepted Accounting Principles ("Canadian GAAP"),
and as such may not be directly comparable to the financial statements
of other Canadian issuers.

As of the second quarter ended June 30, 2010, and in accordance with
IFRS, the Company has elected to report its consolidated financial
statements using the US Dollar as its presentation currency. Previously, the Company reported in Euros. All figures
previously reported in Euros have been converted at historical, average
or closing currency exchange rate, as appropriate and in accordance
with generally accepted accounting principles.

Revenue

(In thousands of US$)

Q1 2011

% change

Q1 2010

(unaudited)

Reporting segment

Mining

59,745

218%

18,811

Water

5,588

-2%

5,714

Total revenue

65,333

166%

24,525

Geographic region

South America

25,715

-

-

Africa

16,935

49%

11,338

North America

14,623

109%

6,988

Asia Pacific

6,111

9%

5,602

Europe

1,950

227%

597

Total revenue

65,333

166%

24,525

Q1 2011 revenue amounted to US$ 65.3 million, an increase of US$ 40.8
million or 166% compared to Q1 2010, as predicted based on the order
backlog reported in December 2010.

The Mining segment, up US$ 40.9 million, is driven by the contribution
of operations in South America (US$ 25.7 million in Q1 2011) and a
generally strong demand from which all operations benefited worldwide
(US$ 15.2 million increase in revenue).

The Water segment remained relatively stable, down by US$ 0.1 million to
US$ 5.6 million in Q1 2011. Activities in this segment are principally
carried out in Africa.

Revenue in South America amounted to US$ 25.7 million in Q1 2011 (nil in
Q1 2010), generated by long-term contracts with major companies in
Chile and strong activity in Argentina.

In Africa, the Q1 2011 revenue increased by US$ 5.6 million or 49%
compared to Q1 2010. This is mainly the result of the Company's
strategy to develop its mining operations in West Africa. The Water
segment, which is significant in this geographic region, remained
stable during Q1 2011 despite the political turmoil in Ivory Coast
where the Company had to stop its operations.

As a result of the continuing improvements in market conditions in
Canada, revenue in North America increased by 109% to US$ 14.6 million
in Q1 2011 from US$ 7.0 million in Q1 2010. Greater demand in the tar
sands activity in central Canada contributed to this increase.

In Asia-Pacific, Q1 2011 revenue amounted to US$ 6.1 million, an
increase of US$ 0.5 million or 9% compared to Q1 2010. The Company
invested in two new rigs in Australia to be delivered during Q2 2011.

Revenue in Europe increased by US$ 1.4 million in Q1 2011 compared to Q1
2010 due to the March restart of operations in Russia, where activity
has been low during the winter season which lasts from October to
February.

The Company has no presence in North Africa, the Middle East or Japan
and as such is not directly affected by recent events in these areas.
The Company does not anticipate any indirect consequences stemming from
these events.

Gross Profit

(In thousands of US$)

Q1 2011

% change

Q1 2010

(unaudited)

Reporting segment

Mining

13,035

238%

3,862

Water

1,486

-4%

1,541

Total gross profit

14,521

169%

5,403

Overall, Q1 2011 gross profit amounted to US$ 14.5 million (or 22% of
revenue), an increase of US$ 9.1 million or 169% compared to Q1 2010
(US$ 5.4 million or 22% of revenue).

In the Mining segment, the trend towards recovery in contract margins in
South America, first seen during Q4 2010, continued. The unusual
adverse climatic conditions in West Canada and the mobilization of
contracts in West Africa were compensated by the fact that in general
contracts performed well worldwide. This resulted in an increase in the
gross profit margin from 21% in Q1 2010 to 22% in Q1 2011.

In the Water segment, gross profit margins remained stable compared to
Q1 2010 at 27%.

Selling, general and administrative expenses (SG&A)

(In thousands of US$)(unaudited)

Q1 2011

% change

Q1 2010

Selling, general and administrative expenses

5,916

54%

3,841

As a percentage of revenue

9%

-

16%

Q1 2011 SG&A amounted to US$ 5.9 million, an increase of US$ 2.1 million
or 55% compared to Q1 2010. As a percentage of revenue, SG&A are now 9%
of revenue in Q1 2011 as compared to 16% of revenue in Q1 2010. As
anticipated, SG&A as a percentage of revenue decreased as a result of
the profitable growth strategy implemented by the Company.

Operating profit

Q1 2011

% change

Q1 2010

(In thousands of US$)

(unaudited)

Reporting segment

Mining

7,625

710%

941

Water

980

50%

653

Total operating profit

8,605

440%

1,594

Operating profit increased to US$ 8.6 million in Q1 2011 compared to US$
1.6 million in Q1 2010. This variation is primarily due to the
satisfying level of gross margin, together with the reduction of SG&A
as a percentage of revenue.

Financial Position

The following table provides a summary of the Company's cash flows for
Q1 2011 and Q1 2010:

(In thousands of US$)

Q1 2011

Q1 2010

Cash generated from operations before working capital requirements

15,651

4,673

Working capital requirements, interest and tax

(12,178)

(7,493)

Net cash flow from operating activities

3,473

(2,820)

Purchase of equipment in cash

(6,411)

(1,668)

Acquisition of subsidiaries, net of cash acquired

(3,800)

-

Net cash used in investing activities

(10,211)

(1,686)

Repayment of financial debts, net of proceeds

5,179

137

Acquisition of treasury shares

(484)

(134)

Net cash used in financing activities

4,695

3

Exchange differences and other items

396

(1,349)

Variation in cash and cash equivalents

(1,647)

(5,852)

(*) The last installment related to the EDC acquisition, amounting to
US$ 3.8 million will be paid in Q2 2011.

Q1 2011 cash generated from operations before changes in operating
assets and liabilities increased to US$ 15.7 million in 2011 from US$
4.7 million in 2010.

As a result of seasonality, Q1 is generally marked by an increase in the
working capital requirement. The working capital requirements rose as
expected from US$ 7.5 million to US$ 12.2 million, in line with the
increase in activity.

During the quarter, the Company acquired operating equipment through US$
6.4 million in cash purchases and US$ 4.8 million in finance leases not
shown in the table above as they were non cash transactions, compared
to a total of US$ 1.7 million during the same period in 2010.

In 2011, cash is generated mainly by dollar related operations. A larger
percentage of the cash available is now kept in dollars, reducing the
exposure to exchange rate fluctuations against the Company's
presentation currency.

As at March 31, 2011, cash and cash equivalents totaled US$ 13.3 million
compared to US$ 20.3 million as at March 31, 2010. Cash and cash
equivalents are invested within top tier European financial
institutions.

As at March 31, 2011, financial debts and equivalents amounted to US$
55.7 million (US$ 49.6 million as at December 31, 2010). In Q2 2011,
the Company will finalize US$ 9 million in additional long-term
financing agreements with French banks and will complete the
reorganization and simplification of its short-term financing structure
in order to align it to its recently enlarged operations.

Currency and Exchange Rates

The exchange rates for the periods under review are provided in the
Management's Discussion and Analysis of Q1 2011.

Dividends

On March 7, 2011, the Board of Directors proposed a dividend payment of
€ 0.028 per share to be approved by Shareholders at the Company General
Meeting on May 10, 2011. Depending upon the country of residence of the
Company's shareholders, it may be necessary for them to complete
certain administrative procedures in order to obtain a refund of
withholding taxes, where applicable. Shareholders should consult with
their tax advisers and can find additional information on the Company
website (www.foraco.com).

Outlook

The Company's business strategy is to continue to deliver profitable
growth through the development and optimization of the services it
offers across geographical regions and industry segments, as well
through the expansion of its customer base. Foraco expects to continue
to execute its strategy through a combination of organic growth and
development and acquisitions of complementary businesses in the
drilling services industry.

Foraco's unaudited Financial Statements and Management's Discussion &
Analysis ("MD&A") for the three month period ended March 31, 2011 are
available via Foraco's website at www.foraco.com and will be available on www.sedar.com.

Conference Call and Webcast

On Tuesday May 10, 2011, Company Management will conduct a conference
call at 10:00 am ET to review the financial results. The call will be
hosted by Daniel Simoncini, Chairman and CEO, and Jean-Pierre
Charmensat, Vice-CEO and CFO.

About Foraco International SA
Foraco International SA (TSX: FAR) is a leading global drilling services
company that provides turnkey solutions for mining, energy, water and
infrastructure projects. Supported by its founding values of integrity,
innovation and commitment, Foraco has grown into a global enterprise
with operations in 22 countries across five continents. For more
information about Foraco, visit www.foraco.com.

"Neither TSX Exchange nor its Regulation Services Provider (as that term
is defined in the policies of the TSX Exchange) accepts responsibility
for the adequacy or accuracy of this release."

Caution concerning forward-looking statements This document may contain "forward-looking statements" and
"forward-looking information" within the meaning of applicable
securities laws. These statements and information include estimates,
forecasts, information and statements as to Management's expectations
with respect to, among other things, the future financial or operating
performance of the Company and capital and operating expenditures.
Often, but not always, forward-looking statements and information can
be identified by the use of words such as "may", "will", "should",
"plans", "expects", "intends", "anticipates", "believes", "budget", and
"scheduled" or the negative thereof or variations thereon or similar
terminology. Forward-looking statements and information are necessarily
based upon a number of estimates and assumptions that, while considered
reasonable by Management, are inherently subject to significant
business, economic and competitive uncertainties and contingencies.
Readers are cautioned that any such forward-looking statements and
information are not guarantees and there can be no assurance that such
statements and information will prove to be accurate and actual results
and future events could differ materially from those anticipated in
such statements. Important factors that could cause actual results to
differ materially from the Company's expectations are disclosed under
the heading "Risk Factors" in the Company's Annual Information Form
dated March 31, 2011, which is filed with Canadian regulators on SEDAR
(www.sedar.com). The Company expressly disclaims any intention or obligation to update
or revise any forward-looking statements and information whether as a
result of new information, future events or otherwise. All written and
oral forward-looking statements and information attributable to Foraco
or persons acting on our behalf are expressly qualified in their
entirety by the foregoing cautionary statements.